Business groups are braced for a hard Brexit after an uncompromising Conservative party conference that championed taking control of immigration above the need to stay inside the European Union’s single market and secure tariff-free trade.

The pound has sunk to a three-year low against the euro on worries over the UK’s prospects outside the EU, after the government set a timetable for Brexit negotiations and fanned fears it would go for a deal that leaves Britain excluded from the single market.

Britain appears to be bouncing back from the post-Brexit panic in better shape than expected, after a string of indicators showed growth across the manufacturing sector, the building industry and in consumer spending.